Banks, credit unions testify supporting cannabis banking bill

Banking, Legislation

Tuesday, February 19, 2019

Cannabis-based businesses have cropped up throughout states where recreational marijuana is legal but the fact that it remains illegal at the federal level poses certain risks for the financial institutions that service them.

Bank and credit union representatives recently testified before the House Financial Services Committee’s Subcommittee on Consumer Protection and Financial Institutions in support of a measure proposing protections from those risks.

The Federal Reserve Board, Office of the Comptroller of the Currency and Federal Deposit Insurance Corp. have issued information on the host state loan-to-deposit ratios, which are used to determine compliance under Section 109 of the Riegle-Neal Interstate Banking and Branching Efficiency Act of 1994. Review the ratios in Dodd Frank Update’s Library.